477. Mortgagee as express or constructive trustee.

Where the power of sale, whether express or statutory1, provides that the surplus proceeds are to be held in trust for the mortgagor2, the mortgagee becomes a trustee of the surplus proceeds in his hands3; otherwise he becomes a trustee only on proof that there is a surplus in his hands4. The mortgagee is not a trustee of the surplus for the mortgagor or subsequent incumbrancers if before the sale their rights had become statute-barred5